How significant is India’s CSR rule?
India is the first country to have mandated a requirement for CSR spending. The law is very well thought out.
Are Indian companies well prepared to comply with the new rule?
The companies we have met with have been involved in CSR. Some for philanthropy and some for strategic reasons. Now, they are looking at creating initiatives while complying with the guidelines. They are taking compliance seriously. We are looking at a variety of people from different fields, and they say ‘how can we become more strategic’, which I believe is the intent of the law. With globalisation and increased access to information, companies are growing around the world, leaving their home markets. With entry into new markets, they need to earn the licence to operate and they need to give to get back. That is what is happening today which, I believe, the law will accelerate in India.
How can CSR be part of a company’s strategy?
It is not going to be that easy. But giving up control, finding the core essence of the brand, focusing on a social issue that makes sense, knowing that you are going to make some mistakes but if you are honest about it, that will benefit the company, employees and the community. An IBM research in 2012 found that the transparency of social media had made the actions, the character and the behaviour of an organisation as important as the products and services it sold. I think smart people have put the law together — it is well shaped and is certainly going to leverage and speed up the momentum of public engagement on social issues in India.
What would your advice be to Indian companies on CSR?
First, when you are deciding on a focus, it should not come from one area. Bring together a cross-functional senior-level team. It might struggle to engage initially, but over time it will see the benefits of this engagement. The team will discover opportunities for innovation which, in turn, will help a company generate more revenue in the long run. The second thing is the opportunity in the partnerships that get developed. For instance, most companies do not have expertise in water, sanitation and education and need to find NGOs which can help. Experts know where the need is.
(This story was published in BW | Businessworld Issue Dated 03-11-2014)
Source: http://www.businessworld.in/news/opinion/interviews/%E2%80%98firms-need-to-give-to-get-back%E2%80%99/1574557/page-1.html
India is the first country to have mandated a requirement for CSR spending. The law is very well thought out.
Are Indian companies well prepared to comply with the new rule?
The companies we have met with have been involved in CSR. Some for philanthropy and some for strategic reasons. Now, they are looking at creating initiatives while complying with the guidelines. They are taking compliance seriously. We are looking at a variety of people from different fields, and they say ‘how can we become more strategic’, which I believe is the intent of the law. With globalisation and increased access to information, companies are growing around the world, leaving their home markets. With entry into new markets, they need to earn the licence to operate and they need to give to get back. That is what is happening today which, I believe, the law will accelerate in India.
How can CSR be part of a company’s strategy?
It is not going to be that easy. But giving up control, finding the core essence of the brand, focusing on a social issue that makes sense, knowing that you are going to make some mistakes but if you are honest about it, that will benefit the company, employees and the community. An IBM research in 2012 found that the transparency of social media had made the actions, the character and the behaviour of an organisation as important as the products and services it sold. I think smart people have put the law together — it is well shaped and is certainly going to leverage and speed up the momentum of public engagement on social issues in India.
What would your advice be to Indian companies on CSR?
First, when you are deciding on a focus, it should not come from one area. Bring together a cross-functional senior-level team. It might struggle to engage initially, but over time it will see the benefits of this engagement. The team will discover opportunities for innovation which, in turn, will help a company generate more revenue in the long run. The second thing is the opportunity in the partnerships that get developed. For instance, most companies do not have expertise in water, sanitation and education and need to find NGOs which can help. Experts know where the need is.
(This story was published in BW | Businessworld Issue Dated 03-11-2014)
Source: http://www.businessworld.in/news/opinion/interviews/%E2%80%98firms-need-to-give-to-get-back%E2%80%99/1574557/page-1.html
